Clean Power Plan repeal won't affect San Juan Generating Station retirement plans

Local officials, activists react to repeal

Megan Petersen
Farmington Daily Times
San Juan Generating Station is pictured, Wednesday, Jan. 13, 2016 in Waterflow.
  • San Juan Generating Station planned to phase out coal before Clean Power Plan took effect.
  • Kirtland mayor says coal controversy won't go away, and regulations will cost local jobs.
  • Farmington activist says repeal is a missed opportunity to wean energy industry off of coal.

FARMINGTON — The San Juan Generating Station will continue the process to eliminate coal consumption despite an effort by the Environmental Protection Agency to the withdraw the Clean Power Rule.

Dan Ware, communications specialist for Public Service Company of New Mexico, a majority owner of the station, said that’s been the plan all along.
“The initial plan to retire two of the units was not a result of the Clean Power Plan,” Ware said. “It was to comply with regional haze regulations." He said the plan to retire those two units was already in place before the "clean power plan even came about."

PNM announced plans to retire the coal-fired generating station earlier this year, with the goal of shutting down two power units by the end of this year and the final two by 2022. 

Ware said on Tuesday that the decision to retire the plant is an economic one. 

“It really has nothing to do with the Clean Power Plan in of itself -- it has to do with economics,” Ware said. “Really we don’t anticipate any changes if the EPA repeals the Clean Power Plan. We need to move forward with the most cost-effective way to serve our customers.” 

During a speech on Monday in Hazard, Tenn., EPA Director Scott Pruitt announced that the agency would publish a proposed rule to withdraw the Clean Power Plan, which limits greenhouse gas emissions for existing power plants. 

Warren Unsiker, CEO of Four Corners Economic Development, said the repeal will have the effect of leveling the playing field between coal and natural gas and would “basically kind of insulate coal-based economy from future decline.”

“It’s encouraging to see things that at least nod to the fact that there’s efforts to try and bolster coal industry, but we still have to wait and see far reaching impacts,” Unsiker said. “... Being that we’ve already become compliant with this plan, (future impacts) may be more muted for our area.” 

The EPA will propose to withdraw the Obama-era rule in its entirety, saying that the rule exceeds the EPA’s authority, according to a draft of the rule published by the Washington Post. 

The EPA has not proposed a replacement to the rule, but it is “in the process of considering whether it is appropriate to propose such a rule” to address green-house gas emissions from existing electric utility generating units and intends “to solicit information on systems of emission reduction that are in accord with the legal interpretation proposed” in the draft, according to the 43-page document. The issue is not currently open for comment, but would be when the EPA submits a replacement rule to the Federal Register. 

Kirtland Mayor Mark Duncan said he agrees with the EPA’s decision to roll back on emissions regulations, but also said “the EPA shouldn’t have any authority whatsoever.”

“There’s some things (the EPA does) that I think are good, but they have authority that I think they shouldn’t have,” Duncan said. 

Duncan said the Clean Power Plan was not necessary to begin with, but he doesn’t see this repeal as the end of the conversation. 

“I don’t think it’s going to go away, and I think we’re going to lose power plants and people are going to lose good jobs as a result of that and what a tragedy,” Duncan said. “What are we going to replace with? Walmart door greeter, McDonald’s?”

Mike Eisenfeld, the energy and climate program manager for the San Juan Citizens Alliance, called the repeal “an arbitrary and capricious decision.”

“Economics of coal are faltering,” Eisenfeld said. “This gives a renewed life to more investments in coal plants, and I think we’re missing a big opportunity to wean ourselves from something that’s been clearly identified as a huge problem.” 

Megan Petersen covers business and education for The Daily Times. She can be reached at 505-564-4621.